Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World

by Don Tapscott

Transparency is crucial for changing the behavior of an institution. While we of course cannot force these values and behaviors on our public representatives, we can limit their decisions and actions through smart contracts that define their roles and responsibilities as our representatives and then monitor and measure them on the blockchain.

technology affected democracy?

1. Fragmenting Public Discourse

2. Scaling Ignorance on the World Wide Web

3. Complicating Policy and Implementation

“Do corrupt governments want to keep themselves honest?”44 asked Anson Zeall, CEO of CoinPip,

ALTERNATIVE MODELS OF POLITICS AND JUSTICE If the blockchain could enable a more efficient, responsive government and improve how democracy is administered through new voting procedures, could it also catalyze new political processes as well?

Liquid democracy, also called delegative democracy, allows citizens the ultimate in customization and personalization of the democratic experience.

Blockchain technologies could supercharge all of these tools.

contributions from citizens could be private, opening up the possibilities of engagement.

Swan, founder of the Institute for Blockchain Studies, argues that blockchain technology might have a maturing impact on how society approaches topics like governance, independence, and civic duty. “It might seem harder to let go of centralized authority in matters of government and economics as opposed to culture and information, but there is no reason that social maturity could not develop similarly in this context.”

Clearly there will be a struggle to bring about change, but citizens of the world, unite! You have everything to gain through the blockchain!

Smart contracts on the blockchain can eliminate the magnitude of this complexity, replacing a mission-critical role of music labels in this ecosystem. According to Imogen Heap, “If you’re a computer program, a piece of software, a database . . . these issues disappear, as it’s just maths half the time. This bit goes to this person . . . and it doesn’t take a year or two to reach the artist, writer, performer. . . . It’s instant because it’s automated and verified. On top of this, culture-shifting new music distribution services gather really useful data from artists’ fans, which could massively help us be more efficient if the artists themselves could get to it.”17 That’s the future of music on the blockchain.

“Wouldn’t it be nice if I could just decide how I’d like my music to be shared or experienced?” Heap asked.

The new music industry is not a pipedream. In October 2015, Heap launched her first experiment by releasing her song “Tiny Human,” and all related data—the instrumental version, seven stereo stems, front cover image, music video, liner notes on musicians, gear, credits, lyrics, acknowledgments, and useful links, and the story behind the song—on the Internet.19 These details would increase her discoverability on the Internet, that is, to help potential collaborators to find her.

new ecosystem

Value Templates to construct deals that respect the artist as entrepreneur and equal partner in any venture, integral to value creation.

Inclusive Royalties that divide revenues fairly according to each person’s contribution to the creative process, not only composers and performers, but also the other artists and engineers.

Transparent Ledgers distributed on the blockchain so that everyone could see how much revenue a song was generating, the timing and magnitude of the revenue streams, and who was getting what percentage.

payment of taxes. Micrometering, Micromonetizing functionality to stream the revenues, not just the music.

Rich Databases that can interface with one another and associate the core copyrighted material—lyrics, composition, and recordings—with all their metadata, the liner notes, the artwork and photographs, the individual tracks, the rights that the composer and the performer are willing to license, the terms of licensing, contact information, and so forth—in the digital ledger for all to see. No more incomplete databases of rights. Rights availability at your fingertips! Rights holders would be easy to find.

Usage Data Analytics in the hands of artists at last, to attract the right advertisers and sponsors, organize tours, plan promotions and crowdfunding resources and future creative collaborations with other artists.

Digital Rights Management, that is, a means of managing digital rights, not the anticonsumer DRM software wrapper that was all about restricting usage.

Auction/Dynamic Pricing Mechanisms to experiment with promotions and versioning of content, even peg subsidiary rights royalty percentages to the demand of a song.

Reputation System that culls data from a bitcoin address’s transaction history and social media, to create a reputation score for that address.

key point of this new fair music industry is that the artists are at the center of their own ecosystem, not at the edges of many others.

potential of the bitcoin blockchain as a technology that could ensure that goal, starting with its transparency. “I just believe in transparency in everything,”

Artlery utilizes the bitcoin blockchain in several ways. First, it registers the provenance of the art as metadata on the blockchain through a partnership and API integration with another bitcoin start-up, Ascribe.io, and it uploads the payout table so that all stakeholders are paid immediately according to their asset shares with immediate transparency for all parties. It is exploring various techniques for encoding this information, such as a bitcoin script inside transactions. While its initial target market is fine art, Artlery has significant traction in other copyright industries such as music, books, and movies, which it will target through the release of its own API.

Melanie Swan, a leading blockchain theorist and academic, was more specific about where to educate students about the blockchain, and it’s not in traditional universities. It’s on the blockchain.

We’ve heard bitcoin used with similar grandiosity in campaigns of all stripes. Like every revolutionary technology, the bitcoin blockchain has its upside and its downside.

after reading this section you may be tempted to dismiss these blockchain innovators because they face serious obstacles. We encourage you to consider whether these are either “reasons the blockchain is a bad idea” or “implementation challenges to overcome.”

challenge is multifaceted.

Had Greek citizens known about bitcoin during their country’s economic crash in 2015, they still would’ve been hard-pressed to locate a bitcoin exchange or a bitcoin ATM anywhere in Athens.

bitcoin blockchain isn’t ready for Greece either. That’s the second facet: it falls short on security controls for such a massive bump in usage.

third facet of this showstopper, its inaccessibility to the average person.

long-term illiquidity because bitcoin is finite in quantity—21

high latency: for the bitcoin blockchain network, the process of clearing and settling transactions takes about ten minutes, which is far faster end to end than most payment mechanisms.

sixth dimension is behavioral change

seventh dimension is societal change.

eighth dimension, the lack of legal recourse

Hashing, the process of running pending transactions through the secure hash algorithm 256 (SHA-256) to validate them and solve a block,

burns a lot of electricity.

In early 2015, The New Republic reported that the combined processing power of the bitcoin network was hundreds of times greater than the aggregate output of the world’s top five hundred supercomputers.

As citizens who care about our planet, we should all be concerned. There are two issues, one around the electricity used to run the machines and another around the energy used to cool them so that they don’t fail.

From one perspective, all this electricity consumption makes sense.

The second energy-related issue is computer architecture itself.

For bitcoin’s core developers, the concern is legitimate and worth solving: “If bitcoin really does become a global team network, I think we will need to slowly move away from proof of work as the only way it’s secure,” said Andresen. “In the very long run, maybe we will move away from proof of work as the way the network is secured, and we’ll combine it with something else.”

the purpose of consensus algorithms is to distribute the right to decide what the state of the blockchain is to a decentralized set of users.

three securely decentralized sets of users, and each set corresponds to a set of consensus algorithms: owners of computing power,

with standard proof-of-work algorithm; stakeholders, with various proof-of-stake algorithms in wallet software; and members of a social network, with...